Time and Cost Overruns in Power Projects in Kenya:ACase Study of Kenya Electricity Generating Company Limited

Abstract

Time and cost overruns in infrastructure development projects duringimplementation continue to pose great challenges to developingcountries. Research has found that many factors impede the successfulcompletion of projects on time, within budget and of good quality. Thisstudy sought to investigate the factors that significantly contributed totime and cost overruns in power projects implemented by KenGen, toevaluate their relative ranking and to quantify their impacts. The studywas based on a questionnaire survey conducted with persons drawnfrom contractors, consultants and KenGen, who are involved in theimplementation of one or more of the four projects in the study. Analysisof 33 significant variables from the survey revealed eight underlyingfactors contributing to overruns, namely, contractors ' inability, improperproject preparation, resource planning, interpretation of requirements,definition of the work involved, timeliness, government bureaucracyand risk allocation. As regards ranking, government bureaucracytopped the list while risk allocation was shown to have been the leastsignificant. There was also a perception that these factors would recurin KenGen ' s future projects in a similar implementation environment.By closely relating the factors to the variables, it was observed thatthey resulted in overruns in the projects by varying magnitudes. Theprojects had time overruns ranging from €“4.6% to 53.4 %, while the  cost overruns varied between 9.4% and 29%. These revelations shouldenable planners to take stock of past performance and incorporatethe lessons learnt in future project planning and implementation.Because the variables and underlying factors are likely to recur infuture projects, their occurrence needs to be anticipated andappropriate strategies and mechanisms designed in order to overcomeor minimize their potential impact. Recommendations are given to assistthe Government of Kenya (GoK) and KenGen on how projectmanagement could be improved when future projects are planned andimplemented. The findings of this paper can be used as a reference byproject owners, managers and agencies in developing their own projectmanagement strategies.Keywords: KenGen; project management; overruns; variables; factors; projectimplementation